TaxTMI 
TaxTMI 
TaxTMI 
2010 (2) TMI 739
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....ome under section 14A of the Income-tax Act, 1961. 4. The learned CIT(A) erred in disallowing a sum of Rs. 20,60,000 under section 36(1)(iii) being entire interest on fund borrowed during the year." 2. At the time of hearing before us, the learned AR has not pressed Ground No. 3; therefore, the same is dismissed as not pressed. 3. Ground Nos. 1 and 2 are related to rejection of assessee's claim of long- term capital loss. 4. Briefly, the facts relating to raise these grounds are that during the assessment proceedings, the Assessing Officer noticed that the assessee has claimed long-term capital loss amounting to Rs. 3,69,08,837. The assessee appended a note to the return of income, which reads as under:- "During the year, the company received an order dated 16th June, 2003 from Maharashtra Industrial Development Corporation agreeing to refund a sum of Rs. 9,49,99,995 against a premium of Rs. 10,00,00,000 paid towards acquisition of leasehold land at Chakan, Pune in financial year 1998-99. The long-term capital loss of Rs. 3,69,08,837 (as computed under Statement No. 2) on surrender of this land is being carried forward, under section 74 for e....
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....he assessee never owned the capital asset, which he could transfer. Therefore, there is no capital gain/loss. The CIT(A) confirmed the order of the Assessing Officer by observing as under:- "1.7 I have gone through the facts of the case, submission made and also the order of the Assessing Officer. From the facts narrated by the Assessing Officer in the assessment order and also from the submission made by the appellant before the Assessing Officer and also at the stage of appeal proceedings, I have noted that on 27-1-1999 relevant to assessment year 1999-2000, the appellant had entered into an agreement with Maharashtra Industrial Development Corpn. for grant of lease of the land and premises for a period of 95 years after paying a consideration of Rs. 10 crores. As per the agreement, the appellant had to pay such recurring fees in the nature of service or other charges as may be prescribed by the Government of Maharashtra. One of the clauses of the agreement required the appellant to submit the plans and commence construction of manufacturing facility thereon with a period of 48 months from the date of execution. However, due to uncertain market conditions, the manufacturi....
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....aid. This valuable right was surrendered by the assessee, therefore, there is Transfer of a capital asset which is liable to capital gains or loss. The land claimed by the assessee is in respect of long-term capital assets, therefore, the same is allowable as long-term capital loss. The learned AR in support of his contention relied upon the following judgments:- (a) A. Gasper v. CIT [1979] 117 ITR 581 (Cal.). (b) CIT v. Pramia Engg. (P.) Ltd. [1993] 202 ITR 298, [1992] 63 Taxman 579 (Cal.). (c) CIT v. Sujatha Jewellers [2007] 290 ITR 631, 160 Taxman 183 (Mad.). (d) CIT v. A.R. Damodara Mudaliar and Co. [1979] 119 ITR 583, [1980] 3 Taxman 277 (Mad.). 5.1 The alternate submission of the learned AR is that without prejudice to the main argument, the loss pertaining to transfer of leasehold right to Lucas TVS Ltd. is allowable as long-term capital loss. 6. The learned DR, on the other hand, relied upon the order of CIT(A), particularly, page 5 Para 1.7 of the order and submitted that the assessee was not the owner of the property, therefore, long-term capital loss has been rightly disallowed by the Assessing Officer. 7. We have h....
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.... any municipality or cantonment board referred to in item (a), as the Central Government may, having regard to the extent of, and scope for, urbanisation of that area and other relevant considerations, specify in this behalf by notification in the Official Gazette;] [(iv) 6 ½ per cent Gold Bonds, 1977 [or 7 per cent Gold Bonds, 1980,] [or National Defence Gold Bonds, 1980,] issued by the Central Government;] [(v) Special Bearer Bonds, 1991, issued by the Central Government;] [(vi) Gold Deposit Bonds issued under the Gold Deposit Scheme, 1999 notified by the Central Government;]" "(47) ["transfer", in relation to a capital asset, includes,- (i) the sale, exchange or relinquishment of the asset; or (ii) the extinguishment of any rights therein; or (iii) the compulsory acquisition thereof under any law; or (iv) in a case where the asset is converted by the owner thereof into, or is treated by him as, stock-in-trade of a business carried on by him, such conversion or treatment;] [or] [(iva) the maturity or redemption of a zero coupon bond; or] [(v) any transaction involving the allowing of the posses....